Verizon wants to only pay for channels that TV customers actually watch

"We are paying for a customer who never goes to the channel."

Verizon wants to disrupt the television industry with a simple idea: smaller networks and media outlets shouldn’t be paid as much as big networks that offer channels on cable and satellite providers.

Verizon pays a per-subscriber fee for the right to air various channels via FiOS TV (it's the sixth-largest provider in the US). But that fee is a flat amount based on how many potential viewers those channels could have, not the actual number of viewers.

"We are paying for a customer who never goes to the channel," Terry Denson, the phone company's chief programming negotiator, told the Wall Street Journal on Sunday.

The Verizon official also said that he’d like to offer small and midsize channels the chance to charge more or less, based on Verizon’s set-top box data. "If you are willing to give a channel five minutes of your time, the cash register would ring in favor of the programmer," Denson added, declining to say which channels he was working with.

"It feels like certain content players who have a suite of channels attempt to lever the strong ones to prop up the weak ones…without any empirical data to show that these channels are actually viewed or wanted," Denson noted.

Like that'll ever happen Still,it would be a good idea if Verizon(and by a loooong extension BSkyB here in Ireland) go one step further and just provide customers a finer grained way to pick which channels we get or not,because way too many channels are only useful as filler that extends your channel surfing to discover that nothing good's on atm

I believe that Verizon is playing what would be in the cable industry "the most dangerous game". They start making that argument, and suddenly cable channels have no reason to resist a la carte pricing, and direct access to live TV over services like Hulu, bypassing Verizon entirely.

If they only want to pay a la carte, then I only want to pay a la carte. I've got dozens of channels I'm not really watching, dozens more I've probably never even noticed in the first place. And yet, here I am paying for all of them too...

This is a bad idea, because we'll lose the channels like Science or Discovery (although i suspect Discovery is highly watched) in favor or channels that show Honey Boo Boo and The Bachelor.

I suspect we NEED pooled payments for channels, to prevent this from happening.

I doubt the numbers that can prove or disprove this are publicly available though.

I would think Science and Discovery are alright, but yes somehow channels that play nothing but Golden Girls are being watched over educational programming.

Plus let's not jump the gun here, they still need to be competitive with options. Doesn't make sense to offer less programming choice. "Now offering even fewer channels!" Isn't exactly a good marketing technique.

"... it would prefer to pick and choose which channels it wants to carry and be able to drop low-rated channels."

I chose my cable service package because I LIKE some of those low rated channels. Drop those and the service I have becomes less valuable to me, which then changes the incentive I have to keep the service.

While I'm not so naive as to think that Verizon has any intention of passing savings along to the customer, anything that makes the viewership-revenue link more tightly coupled is likely to improve overall alignment of channel and show content to what people actually want to watch.

"... it would prefer to pick and choose which channels it wants to carry and be able to drop low-rated channels."

I chose my cable service package because I LIKE some of those low rated channels. Drop those and the service I have becomes less valuable to me, which then changes the incentive I have to keep the service.

Sorry Sarge, but I have to disagree with you. A disruption like this is exactly what is needed in this industry! If the low-rated channels happen to get dropped, then they will evolve and offer better IP-based viewing options (good), and if it forces the service providers to offer better options to their customers, well...better!

Thinking about this a-la-carte thing more. I wonder if metered television billing could be a workable concept. You get all the channels right out of the box, and just pay according which channels and how much of them you watch.

I suspect we NEED pooled payments for channels, to prevent this from happening.

Pooled payments for channels are the main reason I resigned from my cable TV. I was sick of paying $50 a month for watching one sports channel, because I was forced to have hundreds of other channels that I never watched. If TV will evolve to the point where I can pay per channel, I will consider going back to cable TV.

Verizon - "We are paying for a customer who never goes to the channel."

Customer - "We are paying for a channels we never even watch."

Whats good for the goose...

Right on.

Verizon, Comcast, and the rest should be forced back to being dumb pipes. Everything else should go TCP/IP and do away with this middle-man shit. You want ESPN? Go to espn.com, get a subscription and pay/watch like you would any other online service. This should apply to everything. Sure, you can't just channel "surf" anymore, but do you really care to lose all the shit you blow past anyway as you search for what you really want? You could also say, 'who wants a million accounts to watch X'. Well, perhaps I'm getting anecdotal, but almost every single person I know watches less than 5 channels regularly. And many channels are all owned by the same entity anyway ( espn again, as example ).

Thinking about this a-la-carte thing more. I wonder if metered television billing could be a workable concept. You get all the channels right out of the box, and just pay according which channels and how much of them you watch.

Or alternatively - you pay access to the channels you like and if you spend watching a certain amount of programming on something outside them,you'll get a surcharge with your next bill equal to a month's (or week's) subscription,but without automatically signing up for it. The added benefit of going that route is that content providers will know then which of their programs 'work' and which are pure waste of resources

Edit:As one poster mentioned that this sort of practice might hurt channels like Discovery or Science, I'd like to amend ^ that you still get a package of sorts that gets you access to them in the first place,but depending on viewing habits,you don't pay for parts of it that you don't watch. That said,I wouldn't mind seeing some of my documentary channels gone for good,because no offence to History - but I fail to see how swamp-logging or a UFO crackpot shows have to do with the channel :|

If they only want to pay a la carte, then I only want to pay a la carte. I've got dozens of channels I'm not really watching, dozens more I've probably never even noticed in the first place. And yet, here I am paying for all of them too...

Hate to say it, but maybe you should stop paying for it then.

I know plenty of people who complain about the high cost of cable, yet they continue to bend over and take it while the providers rake in the cash.

I put my money where my mouth is and canceled almost a year ago, and I'm happier for it. Netflix/YouTube and over-the-air digital provide more than enough content, and I don't have to sit around watching commercials and garbage shows like Real Housewives of Toddlers in Tiaras from Jersey Shore.

This is a bad idea, because we'll lose the channels like Science or Discovery (although i suspect Discovery is highly watched) in favor or channels that show Honey Boo Boo and The Bachelor.

I suspect we NEED pooled payments for channels, to prevent this from happening.

I doubt the numbers that can prove or disprove this are publicly available though.

I really don't want to pay for 13 jesus channels.

I don't watch shopping channels.

Actually both of those channels will pay the cable/satellite company to carry them, not the other way around like it normally is.

I've said for a while now a la carte wouldn't help much in terms of cutting down your cable bill. Disney needs a certain amount of revenue to run ESPN, so if everyone went a la carte, they'd simply adjust the $/mo they charge cable companies per subscriber. So instead of $7/mo for ESPN/ESPN2, you'd pay $15.

Thinking about this a-la-carte thing more. I wonder if metered television billing could be a workable concept. You get all the channels right out of the box, and just pay according which channels and how much of them you watch.

But I don't think we want to go all the way to a pay-per-view system either. Then you end up paying $100 just to watch the Superbowl. Or $1 for low cost TV episodes contrasted with $5 for higher cost episodes.

I would rather go with a Netflix/Spotify model over an iTunes model, but perhaps there is room for both depending on needs.

If they only want to pay a la carte, then I only want to pay a la carte. I've got dozens of channels I'm not really watching, dozens more I've probably never even noticed in the first place. And yet, here I am paying for all of them too...

Hate to say it, but maybe you should stop paying for it then.

I know plenty of people who complain about the high cost of cable, yet they continue to bend over and take it while the providers rake in the cash.

I put my money where my mouth is and canceled almost a year ago, and I'm happier for it. Netflix/YouTube and over-the-air digital provide more than enough content, and I don't have to sit around watching commercials and garbage shows like Real Housewives of Toddlers in Tiaras from Jersey Shore.

I too, cancelled cable. It is perfect for a lot of things, but when I want to watch a hockey game or any other live event (sports or otherwise) I am generally out of luck. This is why a pay for what you want option would work for so many people.

In the future there will be a few "pools" of content you can subscribe for a fixed amount and watch what you want, when you want. People aren't interested in TV. They're interested in movies, series and whatnot. This will be made possible by the virtually non-existent variable costs of providing content over the Internet and a potential market of 7 billion customers. The sooner we get there the better.

Thinking about this a-la-carte thing more. I wonder if metered television billing could be a workable concept. You get all the channels right out of the box, and just pay according which channels and how much of them you watch.

Or alternatively - you pay access to the channels you like and if you spend watching a certain amount of programming on something outside them,you'll get a surcharge with your next bill equal to a month's (or week's) subscription,but without automatically signing up for it. The added benefit of going that route is that content providers will know then which of their programs 'work' and which are pure waste of resources

Thinking about this a-la-carte thing more. I wonder if metered television billing could be a workable concept. You get all the channels right out of the box, and just pay according which channels and how much of them you watch.

Or alternatively - you pay access to the channels you like and if you spend watching a certain amount of programming on something outside them,you'll get a surcharge with your next bill equal to a month's (or week's) subscription,but without automatically signing up for it. The added benefit of going that route is that content providers will know then which of their programs 'work' and which are pure waste of resources

I think this could work though you would need to make it easy to block the channels you don't want to watch or have no interest in so you aren't paying for channels because the dog sat on the remote or the kids played with the tv. I can see tons of calls about how they never watched this channel, why are they being billed for it? Get enough service complaints without easy tools to prevent it and Verizon and company won't want to offer it.

For my own viewing, outside of the major networks there are only 3 other channels I watch with any regularity, if it wasn't for the fact that the shows aren't available easily online, I'd not have a subscription at all as an antenna can get everything else I watch. I don't want to have to subsidize reality crap either.

Thinking about this a-la-carte thing more. I wonder if metered television billing could be a workable concept. You get all the channels right out of the box, and just pay according which channels and how much of them you watch.

Would you want Verizon (or anyone) to have that detiled a record of your viewing habits? My habits would bore a nun, so I wouldn't care. Others with more of a focus on privacy issues may feel different.

I believe that Verizon is playing what would be in the cable industry "the most dangerous game". They start making that argument, and suddenly cable channels have no reason to resist a la carte pricing, and direct access to live TV over services like Hulu, bypassing Verizon entirely.

Verizon will have to play that argument very carefully.

When I cancelled cable TV and dropped down to just Internet, my video streaming (Netflix, Hulu, and even YouTube) became terrible. The cable company denies any QoS, but they're full of shit. "Speed tests" run perfectly, as does any large download (ISO, service pack, etc), but streaming video is crap. As a test, I signed back up for TV, and within 24 hours, my video streaming was perfect again. In the end, I had to start paying $10/month extra for the "Turbo" tier to get decent streaming without a TV subscription.

Thinking about this a-la-carte thing more. I wonder if metered television billing could be a workable concept. You get all the channels right out of the box, and just pay according which channels and how much of them you watch.

Would you want Verizon (or anyone) to have that detiled a record of your viewing habits? My habits would bore a nun, so I wouldn't care. Others with more of a focus on privacy issues may feel different.

Unless you are only watching HD Digital television from an open air antenna, they already do.

I too, cancelled cable. It is perfect for a lot of things, but when I want to watch a hockey game or any other live event (sports or otherwise) I am generally out of luck. This is why a pay for what you want option would work for so many people.

I just go to the bar with a few friends and watch the games there. I still spend less than I did with cable, plus I get some food, beer, and good times.

Thinking about this a-la-carte thing more. I wonder if metered television billing could be a workable concept. You get all the channels right out of the box, and just pay according which channels and how much of them you watch.

Or alternatively - you pay access to the channels you like and if you spend watching a certain amount of programming on something outside them,you'll get a surcharge with your next bill equal to a month's (or week's) subscription,but without automatically signing up for it. The added benefit of going that route is that content providers will know then which of their programs 'work' and which are pure waste of resources

I think this could work though you would need to make it easy to block the channels you don't want to watch or have no interest in so you aren't paying for channels because the dog sat on the remote or the kids played with the tv. I can see tons of calls about how they never watched this channel, why are they being billed for it? Get enough service complaints without easy tools to prevent it and Verizon and company won't want to offer it.

For my own viewing, outside of the major networks there are only 3 other channels I watch with any regularity, if it wasn't for the fact that the shows aren't available easily online, I'd not have a subscription at all as an antenna can get everything else I watch. I don't want to have to subsidize reality crap either.

That shouldn't be too hard to implement + the time limit shouldn't be too low,because people would scream bloody murder when they receive their monthly fees.I think something like - an onscreen warning that "This is a channel you're not subscribed to watch. To tune to the channel,please press OK or any other button to skip" followed by something like a timer that shows how close you are to actually having to pay for the channel (where at the threshold you have to explicitly confirm again and every other action would change the station so you don't incur unwanted expenses).

I believe that Verizon is playing what would be in the cable industry "the most dangerous game". They start making that argument, and suddenly cable channels have no reason to resist a la carte pricing, and direct access to live TV over services like Hulu, bypassing Verizon entirely.

Verizon will have to play that argument very carefully.

When I cancelled cable TV and dropped down to just Internet, my video streaming (Netflix, Hulu, and even YouTube) became terrible. The cable company denies any QoS, but they're full of shit. "Speed tests" run perfectly, as does any large download (ISO, service pack, etc), but streaming video is crap. As a test, I signed back up for TV, and within 24 hours, my video streaming was perfect again. In the end, I had to start paying $10/month extra for the "Turbo" tier to get decent streaming without a TV subscription.